AIR FREIGHT FORWARDING SERVICE IMPLEMENTATION OF IMPORTED NUTRISON ENERGY BY VINATRANS

TABLE OF CONTENT Overview about VINATRANS 1.1 The company’s operation 1.2 Personnel structure Implementation Air freight forwarding for Nutrison energy by VINATRANS 2.1 Introduction to the imported goods (buyer, seller and characteristics, total value of the good) .4 2.2 Forwarding process 2.2.1 Receiving documents from Kuehne + Nagel International AG 2.2.2 Customs clearance 2.2.3 Issuing the delivery order .8 2.2.4 Consigning at the airport 2.2.5 Delivering to the customer 2.2.6 Payment 10 Personal observation 10 REFERENCE 12 APPENDIX .13 LIST OF TABLES Table 1.1 Revenue and profit of VINATRANS from 2009 to 2013 (VND)………… Table 2.1 Description of the products…………………………………………………5 TABLE OF FIGURES Figure 1.1 VINATRANS Organization chart .3 Figure 2.1: General diagram of forwarding operations 1 Overview about VINATRANS Name of the Company: VINATRANS INTERNATIONAL FREIGHT FORWARDERS – HANOI BRANCH (VINATRANS) Headquarters: 406 Nguyen Tat Thanh Street, Dist 4, Hochiminh City, Vietnam 1.1 The company’s operation Established in 1995, VINATRANS is a fully-licensed logistics company It is one of the leading integrated logistics companies in Vietnam, providing a full spectrum of third party logistics and supply chain management services including: Multimodal transport: Airfreight – Sea freight – Rail & inland transportation; Transit cargo; Exhibition cargo; Project cargo; Customs clearance; Chartering & shipping agency; Warehouse & distribution; Express courier VINATRANS operates a full comprehensive door-to door logistics service to any destination in the world In Vietnam, despite being a new company, VINATRANS has provided services to more than 100 multi-national corporations and many of the world’s best known such as: Metro Cash and Carry (Retailer); Nidec Tosok (a Japan-based corporation specializing in manufacturing and supplying car gear systems and vehicle spare part); Okaya (specializing in manufacturing and supplying all electronic and telecommunication equipment); Proceeding (a Japan-based company in textile industry); Huyndai Vinashin (dealing in ship building industry); Doosan Heavy Industries Vietnam (a Korea – based company in heavy industries); Posco E & C and Schneider Electric Business result of the company has been positive and profits have increased steadily for the years, which are showed in table 1.1 Table 1.1 Revenue and profit of VINATRANS from 2009 to 2013 (VND) Year Revenues 2010 2011 2012 2013 428,339,599,828 641,060,433,178 819,312,611,567 966,594,710,641 Expenses Profit after taxes 407,958,896,461 20,380,703,367 612,835,284,068 28,225,149,110 789,776,666,941 29,535,944,626 939,907,608,784 26,687,101,857 Source: VINATRANS’ financial statements 1.2 Personnel structure Operating from its headquarters in Ho Chi Minh City, VINATRANS has several other branches in Hanoi, Haiphong, Quang Ninh, Hue, Hoi An, Da Nang, Qui Nhon, Nha Trang, Bien Hoa, Binh Duong and Vung Tau, in which Hanoi office is one of main branch of the company It is located in 5th floor, Lakeview Tower, D10 Giang Vo, Ba Dinh district, Hanoi city VINATRANS departments are divided according to the missions including: Airlines; Forwarding; Shipping; Support function and administration Figure 1.1 VINATRANS Organization chart A A V II R R N L A I T N R E SA N S Source: VINATRANS, 2014, Company profile Implementation Air freight forwarding for Nutrison energy by VINATRANS 2.1 Introduction to the imported goods (buyer, seller and characteristics, total value of the good) Ollin Vietnam Corporation, a manufacturer of ammunition, chlorine, and sodium hydroxide which is located in 781/A12 Le Hong Phong, Ward 12, 10 district, Hochiminh city, Vietnam imported pieces RCP (equivalent to 2226 kg) of Nutrison energy made in Netherlands from Nutrica Middle East DMCC that is located in P.O BOX 487993, JLT JBC5, Dubai, United Arab Emirates The total value of the goods is £ 6,160.00 The payment was made by irrevocable L/C payable 100% contract value at sight of Nutrica Middle East DMCC at the Royal Bank of Scotland PLC, Dubai The goods had been packed in cartons strong enough for long transportation Then, it were transported from Amsterdam international airport, Amsterdam, Netherlands to Noi Bai International airport, Hanoi, Vietnam The carrier in this contract was Kuehne + Nagel International AG In Vietnam, VINATRANS have been representative agency of Kuehne + Nagel International AG who helped the company to clearance and issue the Delivery Order for the importers for 10 years VINATRANS participated in the transaction as a forwarder After receiving the Delivery Order, the importer, Ollin Vietnam Corporation, continued hiring VINATRANS to receive the good in the Airport and transfer the goods from Noi Bai international airport to gathering place in L101 No.35 Cu Loc Street, km6 Nguyen Trai Street, Thanh Xuan district, Hanoi city In summary, in the contract, Nutrica Middle East DMCC was SELLER, Ollin Vietnam Corporation was BUYER, Kuehne + Nagel International AG was CARRIER and VINATRANS was FORWARDER Detailed commodities information was described in Table 2.1 below Table 2.1 Description of the products Commodity NUTRISON ENERGY Quantyty (+/- 10%) Unit price CIP Air Noibai 250x cartons 24.64 Euro/Pack Total (EURO) 6,160.00 Per carton 8xpacks of litre each Product no Product (1) Nutrison energy Batch no Product date 100443356 21-MAR2014 2.2 Code EC-approval Total net 66039 number NL weight 2,226.00 kg Total gross weight 2,282.00 kg Expiry date Packing Nett Gross weight 21-MAR- weight 250 cartons 2,226.00 kg 2,282.00 kg 2015 (8x1000ml) Source: Sale contract and Health certificate of the imported good Forwarding process The forwarding process comprised the participation of parties including: Kuehne + Nagel International AG as the carrier; VINATRANS as the representative of Kuehne + Nagel International AG and forwarder; and Ollin Vietnam Corporation as Importer The forwarding processes and responsibilities of the parties can be summarized as the following diagram Figure 2.1 General diagram of forwarding operations Sources: VINATRANS, 20104, internal training documents 2.2.1 Receiving documents from Kuehne + Nagel International AG VINATRANS have been representatives of Kuehne + Nagel International AG for in Vietnam 10 years After signing the contract with Nutrica Middle East DMCC (SELLER), Kuehne + Nagel International AG was responsible for transportation of goods from Amsterdam international airport, Amsterdam, Netherlands to Noi Bai International airport, Hanoi, Vietnam After that, the company sent the import documents to VINATRANS through the mail VINATRANS, which was representative agency of Kuehne + Nagel International AG in Vietnam, was responsible for customs clearance and issuing Delivery Note to Ollin Vietnam Corporation (BUYER) VINATRANS revived a set of documents including: Purchase Contract, Commercial Invoice, Air waybill, Arrival notice, Health certificate, Free sale certificate, Certificate of Original, Certificate of Analyses, and letter of recommendation for the convenience of customs clearance in Noi Bai international airport These documents provided the information for customs clearance so all the documents could be sent via mail After that, the original documents were sent by courier to prepare all necessary document submitted to the customs after 2-3 days VINATRANS’ forwarder officials had to carefully check the suitability of the information, data on the documents and the information of the customer of the importer before Customs clearance 2.2.2 After Customs clearance receiving all necessary documents from the Kuehne + Nagel International AG, the VINATRANS’ official implemented customs clearance via the electronic software VNACCS The notification process information in VNACCS included the flowing steps: 1) IDA Pre-registration of import clearance (General and detail information of exporter, importer, imported goods) 2) IDC import clearance (No of declaration*) 3) IDB Pre-registration of import clearance (No of declaration, No of air waybill, No of electronic invoices receipt, general management code) 4) Before the declaration of registration, the custom system would automatically check the list enterprises that are not eligible registration declaration (enterprises now have more than 90 days overdue, deactivate, dissolution or bankruptcy ) In this case, the importer was eligible to register declaration, the systems automatically moved to the next step 5) The systems arranged the kind of good under three different channels (1), (2) and (3) In this case, the imported good was accepted in the channel (2) (or yellow channel) The channel (2) composed of imported goods that had to pay for taxes and it’s declared value was up to VDN million The imported goods which were accepted in channel (1) and channel (2) were exempt from actual inspection 6) The last step, the VINATRANS’ official printed completed custom declaration to summit to the custom when consigning at the airport All the above stages occurred in day 2.2.3 Issuing the delivery order After receiving all necessary original documents as mentioned above (2-3 days after the customer sent by Courier) including Arrival notice, the field officer of VINATRANS contacted to Kuehne + Nagel International AG then issuing the Delivery Order The delivery order contained the information of the delivery including: major airway bill number (172-05330065), Sub airway bill number (AMS-13182916), No of packages (04), gross weight (2282.00 kg) and detailed commodity (ASPERHAWB) 2.2.4 Consigning at the airport The carrier and VINATRANS could fulfill their obligations after issuing the delivery note However, Ollin Vietnam Corporation (Importer) continued hiring VINATRANS to consign the commodities at the airport and move on gathering place 2.2.4.1 Registering delivery and printing delivery notes The field officer of VINATRASN submitted Delivery order, letter of recommendation and struck rental certificate to the airline agent to receive delivery confirmation The airline agent’s official stamped on the Delivery order and returned to the field forwarder 2.2.4.2 Customs clearance and receiving the goods at Noi Bai International airport All activities of this process were implemented in Noi Bai International airport The VINATRANS field official went to warehouse in the airport There were warehouses in the airport, which were ACV and NTS, the imported goods was preserved in ACV The warehouse manager provided the official with the original airway bill and warehousing certificate After receiving all necessary documents in the warehouse, the official went to Customs Department to submit these following documents: original airway bill and warehousing certificate that had been already provided by the warehouse manager, letter of recommendation, customs declaration, Invoice, Packing list, Import License, Business registration certificate of the importer After carefully checking these documents and saw that the documents were valid and the goods met import requirement, the Customs official signed on the customs declaration for custom clearance Then, the VINATRANS’s field official went to Noi Bai International airport border gate customs sub-department to pay for fees for parking In this Department, the VINATRANS’s official had to submit the warehousing certificate and Delivery Order After carefully checking the Delivery Order and collecting the fee, the cashier issued receipts, stamped “PAID” and Custom Clearance confirmation on the Delivery Order and gave the stamped Delivery Order and Delivery notes to VINATRANS’s official After that, the VINATRANS’s official returned to ACV warehouse to receive to goods 2.2.4.3 Commodity inspection After checking the Delivery note, airport’s official would move the packages of goods to the inspection place However, because the imported goods which were accepted in channel (1) and channel (2) were exempt from actual inspection, the imported goods were accepted in channel (2), all the packages were moved to the customs gate and loaded onto the rented struck 2.2.5 Delivering to the customer The goods were loaded onto the rented struck to move on gathering place at L101, No.35, Cu Loc Street Km 06, Nguyen Trai st, Thanh Xuan district, Hanoi city The Ollin Vietnam Corporation’s representative received the goods there and prepared for payment 2.2.6 Payment This was the finally step of forwarding After all of the packages of goods were unloaded in the gathering place, the Ollin Vietnam Corporation representative prepared for payment as follows: Firstly, he received all the original custom declaration The VINATRANS’s official only kept the copies of some documents Secondly, the VINATRANS’s official made the debit note including all the fees that VINATRANS had to paid such as Delivery Order fee, warehouse fee, imported products inspection fee, truck rental fee…; the forwarding service charges and transportation fees under the agreement between the two companies and other expenses incurred Because Ollin Vietnam Corporation was not a loyal customer of VINATRANS, the company had to pay immediately after fully receiving the goods within week from the date of receipt of goods The payment would be made via bank transfer Kuehne + Nagel International AG and VINATRANS have been long-term partners The representative agency fees for VINATRANS would be paid by Kuehne + Nagel International AG in the end of the year 10 Personal observation Air freight forwarding was implemented professionally by VINATRANS The officials of VINATRANS were specialized and had many experiences so the forwarding service quality and reputation of the company is increasingly enhanced In the course of business, the company also has created a good relationship with the shipping agents, customs which created favorable conditions for companies in the services operation and forwarding processes were implemented smoothly, and the forwarder did not faced to many difficulties Moreover, some services expenses were much lower than other forwarding companies For example, 3.5 ton truck rental cost by DV Transportation Company is $1per kilometer However, because DV Transportation Company and VINATRANS have been longtime partners, DV Company agreed to reduce the rental cost to $0.85 per kilometer In Hanoi branch Office, although the human resource is limited with a manager and young officials, it has become a trustworthy partner of many enterprises in the North of Vietnam The working environment in the Office is relatively comfortable so the officials are not under high pressure However, in the future, Hanoi branch office should recruit more employees and trainees to avoid overloading and mistakes when implementing multiple contracts in the same time In general, in spite of being a new forwarding company in Vietnamese market, the business activities of VINATRANS developed rapidly The company affirmed its brand name in the market and had credibility with customers and partners 11 REFERENCE VINATRANS, 2014, Company profile VINATRANS, 2013, Tài liệu hướng dẫn sử dụng hệ thống VNACCS VINATRANS, 2013, The company’s financial statement 12 APPENDIX Sales Contract Air Waybill Commercial Invoice Free Sale Certificate Delivery Order Custom Declaration 13 ... administration Figure 1.1 VINATRANS Organization chart A A V II R R N L A I T N R E SA N S Source: VINATRANS, 2014, Company profile Implementation Air freight forwarding for Nutrison energy by VINATRANS 2.1... Air freight forwarding was implemented professionally by VINATRANS The officials of VINATRANS were specialized and had many experiences so the forwarding service quality and reputation of the company...LIST OF TABLES Table 1.1 Revenue and profit of VINATRANS from 2009 to 2013 (VND)………… Table 2.1 Description of the products…………………………………………………5 TABLE OF FIGURES Figure 1.1 VINATRANS Organization